Manhattan U.S. Attorney Announces Securities And Wire Fraud Charges Against Founder And Manager Of Mutual Fund

 Audrey Strauss, the United States Attorney for the Southern District of New York, and Philip R. Bartlett, Inspector-in-Charge of the New York Office of the U.S. Postal Inspection Service (“USPIS”), announced today that OFER ABARBANEL was arrested this morning in Los Angeles, California, and charged with securities fraud and wire fraud in connection with ABARBANEL’s scheme to defraud investors in a mutual fund he founded and controlled.

Manhattan U.S. Attorney Audrey Strauss said:  “As alleged, Ofer Abarbanel conducted a bait-and-switch, promising investors safe and liquid investments but instead transferring their money to risky counterparties to trade for his own benefit and that of his confederates.  His alleged scheme has now been uncovered and he will have to answer for his alleged lies.”

USPIS Inspector-in-Charge Philip R. Bartlett said:  “Postal Inspectors remind investors to thoroughly review all lucrative offers as well as their fund managers.  In this case, as alleged, Mr. Abarbanel devised a scheme to defraud investors with bogus claims of liquidity and collateral, when in fact he did not use investors’ funds as promised and did not acquire the promised collateral.  Our advice is to trust your gut, and remember that where there is high reward, there is high risk.”

According to the Complaint[1] unsealed today Manhattan federal court:    

From at least in or about 2018 through the present, ABARBANEL engaged in a scheme to defraud investors in a mutual fund he founded and controlled (the “Fund”).  ABARBANEL falsely represented to an investment adviser to a group of investors (the “Investor Group”) that investments in the Fund would be placed “primarily” in short-term United States Treasury Securities having maturities less than or equal to three months.  Contrary to these representations, the vast majority of the investors’ funds were not invested in short-term treasuries.  Instead, immediately after the Investor Group’s investment was received by the Fund, ABARBANEL and his confederates transferred the investor funds to counterparties controlled by or otherwise closely associated with ABARBANEL, for use, among other things, in trading not authorized by the Fund’s offering documents and for the benefit of ABARBANEL and the counterparties.

ABARBANEL further represented that, in order to enhance income, the Fund intended to invest in securities lending transactions as well as repurchase and reverse repurchase agreements.   ABARBANEL represented, as to these transactions, that the Fund would receive, in its possession and control, safe and secure collateral, in the form of treasury securities that could be quickly liquidated in the event a counterparty defaulted on its obligations.  ABARBANEL, however, failed to obtain for the Fund the promised collateral to secure the investments. Nonetheless, ABARBANEL repeatedly represented, in substance, that the Fund had possession of the collateral.  

In or about May and June 2021, ABARBANEL failed to honor a redemption request by the Investor Group for all of its outstanding investment, totaling more than $100 million, instead placing conditions on the redemption that were contrary to the Fund’s offering document and to the Fund’s practices with respect to prior redemptions.  On or about June 16, 2021, the Fund transferred more than $10 million in investor funds from the Fund to a personal brokerage account of an attorney working with the Fund. 

ABARBANEL will be presented later today in federal court in Los Angeles.

ABARBANEL, 46, a dual U.S.-Israeli citizen who resides in Woodland Hills, California, is charged with one count of securities fraud and one count of wire fraud.  The securities fraud count carries a maximum sentence of 20 years in prison and a maximum fine of $5,000,000 or twice the gross gain or loss from the offense.  The wire fraud count carries a maximum sentence of 20 years in prison and a maximum fine of $250,000 or twice the gross gain or loss from the offense. 

The maximum potential sentences in this case are prescribed by Congress and are provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.

Ms. Strauss praised the investigative work of the USPIS and thanked the SEC, which has filed civil charges against ABARBANEL in a separate action.  She added that the criminal investigation is ongoing.

The allegations contained in the Complaint are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

[1] As the introductory phrase signifies, the entirety of the text of the Complaint and the description of the Complaint set forth herein constitute only allegations and every fact described should be treated as an allegation. 

Attorney General James Takes Down Major Drug and Gun Trafficking Rings in Capital Region

 

47 Individuals Arrested for Pumping Heroin, Cocaine, Oxycodone

Into Communities, Illegal Possession of Firearms

Defendants Responsible for Recent Shootings, Violent Crime in Albany

 New York Attorney General Letitia James today announced the indictment of 47 individuals for their roles in two major drug and firearm distribution networks that trafficked heroin, cocaine, oxycodone, and firearms in the Capital Region. As alleged in the indictments, unsealed in Albany County Court today, this year-long investigation seized nearly 1.2 kilograms of cocaine, 140 grams of heroin mixed with fentanyl, oxycodone, $40,000 in cash, and nine firearms, including one “ghost gun.”

“For the past year, Albany and the surrounding areas have been plagued by violent crime that has terrorized our communities and claimed too many lives,” said Attorney General James. “These individuals have allegedly flooded our streets with dangerous narcotics and are responsible for many of the shootings that have been at the center of this devastation. Today’s takedown is yet another major action to combat violent crime and hold accountable those who seek to endanger our communities. We will continue to take every action possible to get guns off our streets, and I thank the Albany Police Department, and all our partners in law enforcement, for their support in protecting our communities.”

“Dangerous drugs and weapons have no place in our communities,” said Albany Police Chief Eric Hawkins. “Today, we’re sending a strong message that we will use all available resources to address violent crime in our neighborhoods and remove any offenders responsible from our streets. Through operations, such as ‘Cross Town Quarantine,’ we remain committed to working collaboratively with our law enforcement partners to ensure that our communities remain safe. I’d like to commend Attorney General James for her leadership, as well as her unwavering support to our agency and overall safety of the Albany community.”

Today’s takedown was the result of a joint investigation between the Office of the Attorney General’s (OAG) Organized Crime Task Force (OCTF), the Albany Police Department, and the FBI Safe Streets Task Force. The investigation — dubbed “Operation Crosstown Quarantine” — centered on two rival crosstown gangs in Albany and included the use of physical surveillance, electronic surveillance, and undercover operations. During the course of the investigation, in addition to communication by cell phones, the defendants repeatedly relied on social media, specifically Facebook and Snapchat, to sell and procure drugs and brazenly brag and display illegal firearms. 

Indictment One

The first conspiracy centers around the “Uptown Associates” gang and the leader of this drug distribution network: Jamar Brayboy, a/k/a “Un.” Brayboy employed a vast network of individuals to sell his drugs and had numerous reseller customers that brought heroin and cocaine from New York City to sell in and around the Capital Region, as well as New York and Orange counties, and even had resellers bringing drugs to Vermont. Brayboy also relied on Facebook to illegally sell his narcotics.

The second conspiracy centers around the “Downtown Associates” gang and the leader of this drug distribution network: Tyshawn Morris, a/k/a “Mac.” Morris also employed a large network of sellers and resellers who primarily operated in Albany, Fulton, Montgomery, Rensselaer, Saratoga, and Schenectady counties. Morris is being charged with Operating as a Major Trafficker, which carries a mandatory life sentence in state prison. The defendants and their co-conspirators frequently utilized coded and cryptic terminology in an attempt to disguise their illicit activities. In addition to the usual codes — such as referring to crack cocaine as “hard” and powder cocaine as “soft” — Morris used common street terms for marijuana and to refer to cocaine, in an attempt to confuse law enforcement, in the event they were monitoring his activities. For instance, Morris and his associates referred to crack cocaine as “Sour” and powder cocaine as “Kush,” both common names for marijuana. 

Indictments Two, Three, Four, and Five

During the course of the investigation, OCTF was able to establish that numerous members of the “Downtown Associates” were utilizing Snapchat in order to traffic illegal prescription drugs, namely oxycodone. Keion Kirkley, El Shaquille Douglas, and Daion Morris regularly sold illegal prescription medication (oxycodone and others) over Snapchat by posting pictures and/or videos of pill bottles marked “Oxycodone” with captions, such as “Boots! Rp 10s Rp 20s & Green 15s GWM,” referring to prescription pills (“boots”) for sale, “GWM” (get with me), and what milligram strengths were available, 10mg pills, 20mg pills, etc. 

Other members of the “Downtown Associates,” known as the “50 Gang” — a reference to the high-capacity magazines that they attach to their firearms, which allow them to hold up to 50 rounds of ammunition — were utilizing Snapchat to post videos and pictures of illegal weapons, which they and their fellow members used to carry out their gang violence activities. Members regularly posted videos and pictures of themselves possessing handguns, rifles, and machine guns, usually with high-capacity magazines protruding from the gun. Members of the “50 Gang” range from 18 years old to 25 years old, and they are considered by law enforcement to be responsible for numerous drive-by shootings and homicides that have been plaguing the City of Albany over the past year, including the recent fatal shooting of an 18-year-old in downtown Albany.

The indictments charge 47 individuals with crimes that include various counts of Criminal Sale and Criminal Possession of a Controlled Substance (class A, B, and C felonies); Conspiracy to commit those crimes; various counts of Criminal Sale and Possession of a Firearm; Criminal Possession of a Weapon; and Enterprise Corruption. A fifth indictment also charges two “Uptown Associates” with weapons possession.

Today’s takedown marks the latest major drug bust in the OAG’s Suburban and Upstate Response to the Growing Epidemic (S.U.R.G.E.) Initiative, a law enforcement effort that brings together state and local law enforcement to target New York’s growing — and often violent — heroin, opioid, and narcotics trafficking networks. Since launching in 2017, SURGE has taken 644 alleged traffickers off the streets.

The first indictment contains 521 counts and charges 33 people with crimes in relation to their involvement in the narcotics trafficking operation, including Operating as a Major Trafficker (class A-I felony), Criminal Sale and Criminal Possession of a Controlled Substance (class A, B, and C felonies), as well as Conspiracy in the Second degree (class B felony). 

Those charged in Indictment One include:

DARRELL ANDERSON, 29 years old, Schenectady, NY

BENJAMIN BADGLEY, 29 years old, Clinton, NY

ANDERSON BENOIT, A/K/A “MALI,” 39 years old, Rutland, VT

RONALD BERG, 39 years old, Schenectady, NY

JAMAR BRAYBOY, A/K/A “UN,” 43 years old, Albany, NY

JOHN CHAPMAN, 51 years old, Albany, NY

JESSIE CORNER, 47 years old, Albany, NY

NIEZIER ELLIS, A/K/A “NEECHO,” 26 years old, Albany, NY

RONALD EVANS, A/K/A “GOTTI,” 44 years old, Albany, NY

MANIEF FIELDS, 27 years old, Albany, NY

DEREK GEORGE, 29 years old, Albany, NY

ANTHONY GOLSON, A/K/A “EYE,” 41 years old, Albany, NY

FREDERICK HEIDELMARK, 48 years old, Albany, NY

THOMAS HEMMINGWAY, 41 years old, Albany, NY

DANIEL INGERSOLL, 38 years old, Albany, NY

MAZENE LACY, 41 years old, Albany, NY

CHRISTINA LEWIS, 52 years old, Rensselaer, NY

DONTRAY LUNDAY, 41 years old, Schenectady, NY

ERICA MASON, 38 years old, Warren, NY

JORGE MENDEZ, A/K/A “KUSHIE SUNOCO,” 27 years old, Albany, NY

JOSE MILLER, 52 years old, Albany, NY

TYSHWAN MORRIS, A/K/A “MAC,” 29 years old, Schenectady, NY

LUIS NAVARRO, A/K/A “LV,” 34 years old, Schenectady, NY

JOEMAR NUNEZ, 24 years old, Albany, NY

JOSUE NUNEZ, A/K/A “SWAY,” 40 years old, Albany, NY

RONALD PERSER, 69 years old, Albany, NY

RIZEL SIMS, 31 years old, Montgomery, NY

EMMANUEL SMITH, 50 years old, Warren, NY

ANGEL SOTO, 33 years old, Albany, NY

THERESA STANLEY, 38 years old, Albany, NY

MARCUS VILLANO, 50 years old, Schenectady, NY

KACY WEAVER, 47 years old, Albany, NY

FREDERICK WILLIAMS, 32 years old, Albany, NY

The remaining indictments contain 196 counts and charge 14 people with crimes in relation to their involvement in the narcotics trafficking and weapons possession, including Enterprise Corruption (class B felony), Criminal Sale and Criminal Possession of a Controlled Substance (class B felony), and Criminal Possession of a Weapon (class C, D, and E felonies). 

Those charged in the remaining indictments are:

KAYONTEE BARTEE, 23 years old, Albany, NY

PRINCE CURETON, 28 years old, Albany, NY

PEDRO DAVILA, 26 years old, Albany, NY

EL-SHAQUILLE DOUGLAS, A/K/A “DOLO”, 27 years old, Albany, NY

ALVIN FOY, A/K/A “BHIP”, A/K/A “CHIP”, 18 years old, Albany, NY

DREW GREENE, A/K/A/ “DRIZZY”, A/K/A “TAY K”, A/K/A “SPRAY”, 19 years old, Albany, NY

NICHOLAS HIGGINS, A/K/A “SLICK”, 28 years old, Albany, NY

KEION KIRKLEY, A/K/A “HIT”, 22 years old, Albany, NY

JAHMERE MANNING, A/K/A “SPLASH”, 19 years old, Albany, NY

ZAEQUIAL SHAW, 19 years old, Albany, NY

KYMALE THOMPSON, A/K/A “GLO”, 18 years old, Albany, NY

NEYLON WAGNER, A/K/A “LOTO”, 19 years old, Schenectady, NY

DAION MORRIS, 28 years old, Rensselaer, NY, was charged in a separate, related indictment that was unsealed today containing 13 counts, charging him with Criminal Sale of a Controlled substance (class B felony).

ESHAWN BERKLEY, 23 years old, Albany, NY, was charged in a separate, related indictment that was unsealed today containing 36 counts, charging him with Criminal Possession of a Weapon (C, D, and E felonies).

The charges against the defendants are merely accusations and the defendants are presumed innocent unless and until proven guilty in a court of law.

In addition to law enforcement partners, Attorney General James would also like to thank Albany County District Attorney David Soares for his assistance in this investigation.

The investigation was directed by Albany Police Department Detective Bill Norris, under the supervision of Detective Sergeant James Wood; and OCTF Detective Maria Romeo, with the assistance of the National Guard Counter Drug Task Force, under the supervision of Detective Supervisor John Monte and Deputy Chief John McManus. The OAG’s Investigations Division is led by Chief Oliver Pu-Folkes. 

Hubert Dupigny Sentenced To 25 Years In Prison For Sex Trafficking Minors

 

 Audrey Strauss, the United States Attorney for the Southern District of New York, announced that HUBERT DUPIGNY, a/k/a “Fox,” was sentenced to 300 months in prison for sex trafficking of minors and conspiracy to commit sex trafficking of minors.  DUPIGNY was previously convicted of those offenses, following an eight-day jury trial, on January 24, 2020, before U.S. District Judge Jesse M. Furman.

Manhattan U.S. Attorney Audrey Strauss said:  “Hubert Dupigny trafficked minor victims who were runaways from the foster care system – victims who were half his age and did not have permanent homes or families to take care of them.  Dupigny victimized, and violently abused, some of the most vulnerable members of our society for his own financial gain.  His predatory conduct irreparably damaged the lives of his victims.  Today, Hubert Dupigny was justly sentenced to 25 years in prison for his callous exploitation of those minor victims.”

According to the allegations contained in the Indictment and evidence presented during the trial in Manhattan federal court:

From at least in or about August 2016 through in or about May 2017, HUBERT DUPIGNY, a/k/a “Fox,” the defendant, engaged in a conspiracy to commit sex trafficking of minors.  The defendant recruited two minor victims (“Victim-1” and “Victim-2”) to engage in commercial sex acts when they were living in foster care facilities or homes in New York City.   The defendant took photographs of Victim-1 and Victim-2 in lewd positions, used Backpage.com to post advertisements of them for commercial sex, and then directed Victim-1 and Victim-2 to meet customers to engage in commercial sex out of an abandoned home in Brooklyn, New York.  Victim-1 and Victim-2 saw as many as ten to fifteen customers each day.  The defendant took all of the proceeds from their commercial sex acts, forcing Victim-1 and Victim-2 to be reliant on him for food and clothing.

In addition to today’s prison sentence, DUPIGNY, 38, of Brooklyn, New York, was sentenced to 10 years of supervised release.

Ms. Strauss thanked the FBI and the New York City Police Department for their outstanding work in this matter, particularly the FBI-NYPD New York Child Exploitation and Human Trafficking Task Force.

Any individuals who believe they have information that may be relevant to this investigation should contact the Federal Bureau of Investigation at (212) 384-1000 or https://tips.fbi.gov/.

Governor Cuomo Signs the Gender Recognition Act

 

Allows New Yorkers to Use "X" As Sex Designation on New York State Driver's License

Legislation (S.4402-B/A.5465-D) Eases Process for Name Changes by Removing Requirement to Publish Changes in a Newspaper

Outlines Petition Process to Change Sex Designation and Recognize Gender Identity on New York State Documents, Permits the Use of "Parent" on Birth Certificates and Eases Process to Change a Birth Certificate

 

 Governor Andrew M. Cuomo today signed the Gender Recognition Act, removing longstanding barriers to equality under the law and ensuring expanded protections for transgender and non-binary New Yorkers. The legislation (S.4402-B/A.5465-D) allows New Yorkers to use "X" as a non-binary sex designation on New York State driver's licenses. It also ensures that New Yorkers will be able to have their gender identity on official documents and provides protections to reduce discrimination against nonbinary and transgender New Yorkers by permitting name change and sex designation changes to be sealed more easily. Finally, the legislation will provide New Yorkers the ability to amend their birth certificates and use a designation of mother, father, or parent for the first time.

"Every New Yorker deserves to be free from discrimination and have state-issued identification and processes that respect them for who they are, recognize their gender identity and protect their safety," Governor Cuomo said. "New York continues to lead the way in ensuring LGBTQ people are treated equally in every part of the law and society, and this bill is another landmark that ensures New Yorkers can express ourselves for who we are."

Prior to the Gender Recognition Act's signing, New Yorkers who wanted to change their names were required to publish their new and previous names, current address, place of birth and date of birth in a designated newspaper. This potentially allowed opportunities for discrimination against transgender and nonbinary people who legally changed their names. The Act eliminates this practice. The new law also creates a process to petition a court to change an individual's sex designation or recognize their gender identity. The petition can also be sealed to protect against fear of reprisal or retaliation. Finally, the law creates an easier process to change a birth certificate, and allows the use of the term "parent" for the first time.

The Act establishes new criteria to petition and seal change of name and change of sex designation papers. New Yorkers can now seal their name or sex designation papers if there is a risk of violence or discrimination against the applicant. This includes such applicant's status as transgender or as the subject of domestic violence.

BRONX DISTRICT ATTORNEY’S OFFICE & NYPD TO HOLD GUN BUYBACK

 

Participants Can Turn in Firearms No Questions Asked And Receive Cash Card and Free iPad in Return

 Bronx District Attorney Darcel D. Clark and New York City Police Commissioner Dermot Shea announced today a Bronx Gun Buyback where people can turn in operable handguns or assault rifles, no questions asked, and receive a cash card and free iPad. 

 District Attorney Clark said, “The Bronx has seen far too many shootings since last summer. One of the recent shootings involved two innocent children who were caught in the middle of a gunman and his target. Images of the helpless children have brought international attention to the gun violence plaguing our streets. We must stop these shootings. I am holding this gun buyback along with the NYPD to get firearms off streets and out of homes. I implore those who have weapons to turn them in and save lives, and if you know someone who has an illegal gun, please urge them to turn in the gun. I thank the NYPD for again partnering with my office for this important event, and I thank Rev. Dr. Bruce Rivera for opening his church.”

 The Bronx Gun Buyback will take place at Christ Church located on 860 Forest Avenue, between East 160th and East 161st Streets, between 10 a.m. and 4 p.m. on June 26, 2021. People who turn in operable handguns or assault rifles will receive a $200 pre-paid card plus a free iPad from the Bronx District Attorney’s Office. The free iPad will go to the first 76 participants, limit one per person. Those who turn in operable rifles, shotguns or airguns will receive a $25 pre-paid card.

 So far this year, there have been 257 people shot in the Bronx; last year by now there were 108. As of June 13th, in the 40th Precinct where Christ Church is located, there have been 30 shooting victims so far, compared to 12 last year.

COUNCILMEMBER RUBEN DIAZ UNVEILS JOE TORRES STREET CO-NAMING

 

This Saturday, June 26, 2021, at 12:30 pm, Councilman Rev. Ruben Díaz will name the corner of Thieriot & Westchester Ave as “Joe Torres Way”.   Joe Torres, better known as Joe, a Puerto Rican owner of Restaurant Joe’s Place, died in March 2020 with complications from COVID-19. Joe’s Place was recognized as the most “Criollo” Restaurant in the Puerto Rican and Latino community where elected officials and artists met. Joe’s Place Restaurant was where the highest political and artistic officials arrived in New York met to share with him.   The street renaming ceremony will begin at 12:30 am all are welcome and encouraged to come as we pay tribute to Joe Torres and celebrate his life. Elected officials, community leaders, friends of Joe, and anyone else who would like to come together to remember Joe Torres.     Location: Thieriot & Westchester Avenue Bronx, NY Day: Saturday, June 26, 2021 Time: 12:30 pm

192 Days and Counting

 

Well most of you have voted who will be my replacement. Let's see how long it takes until the Board of Elections gets the final Rank Choice Voting results. Enjoy the Fourth of July Fireworks, and maybe a week later you may know who the new mayor will be. 

What's that, there is a general election in November, and there will be other candidates for mayor, but as everyone knows this is a Democratic city, because we want every single person to come in as long as they are Democrats. 

Governor Cuomo Announces New York Ending COVID-19 State Disaster Emergency on June 24

 

Statewide 7-Day Average Positivity is 0.36%—Record Low for 26 Consecutive Days, Has Declined for 79 Consecutive Days

52,526 Vaccine Doses Administered Over Last 24 Hours

6 COVID-19 Deaths Statewide Yesterday

 Governor Andrew M. Cuomo today announced that New York will end the state disaster emergency declared on March 7, 2020 to fight COVID-19. Given New York's dramatic progress against COVID-19, with the success in vaccination rates, and declining hospitalization and positivity statewide the state of emergency will expire after Thursday, June 24. 

Federal CDC guidance will remain in effect, which includes masks for unvaccinated individuals, as well as all riders on public transit and in certain settings, such as health care, nursing homes, correctional facilities, and homeless shelters. State and local government health departments will still be able to ensure mask rules and other health precautions are adhered to in those settings.

Since March of 2020, a variety of actions had been taken by executive order to assist in the rapid response to the pandemic by state agencies, local governments, hospitals, and businesses by both temporarily suspending or modifying laws as well as utilizing temporary directives. Hospitals were able to add space and staffing, meetings were authorized to occur virtually, and various deadlines were extended to accommodate a changed landscape.

"New York went from one of the worst infection rates to the lowest infection rate in the country, and it was all because of the efforts of New Yorkers who were smart, united and did what they needed to do throughout this entire pandemic," Governor Cuomo said. "Now we're starting to write a new chapter for a post-COVID New York--the state disaster emergency is ending and we can focus on reimaging, rebuilding and renewing our state. This doesn't mean COVID is gone, we still have to get more New Yorkers vaccinated, but we are getting back on track and starting to live life once again." 

Today's data is summarized briefly below:

• Test Results Reported - 90,350
• Total Positive - 310
• Percent Positive - 0.34%
• 7-Day Average Percent Positive - 0.36%
• Patient Hospitalization - 474 (-12)
• Patients Newly Admitted - 64
• Patients in ICU - 104 (-3)
• Patients in ICU with Intubation - 60 (-2)
• Total Discharges - 184,386 (+68)
• Deaths - 6
• Total Deaths - 42,942
• Total vaccine doses administered - 20,702,818
• Total vaccine doses administered over past 24 hours - 52,526
• Total vaccine doses administered over past 7 days - 406,783
• Percent of New Yorkers ages 18 and older with at least one vaccine dose - 68.6%
• Percent of New Yorkers ages 18 and older with completed vaccine series - 62.2%
• Percent of New Yorkers ages 18 and older with at least one vaccine dose (CDC) - 71.2%
• Percent of New Yorkers ages 18 and older with completed vaccine series (CDC) - 63.5%
• Percent of all New Yorkers with at least one vaccine dose - 56.9%
• Percent of all New Yorkers with completed vaccine series - 51.2%
• Percent of all New Yorkers with at least one vaccine dose (CDC) - 59.1%
• Percent of all New Yorkers with completed vaccine series (CDC) - 52.3%